The nearly six decades of debate on environment-friendly development, the four decades of conceptualisation of sustainable development and the two decades of increased polemics on the circular economy are essentially rooted in either the reduction of wasteful consumption of products or reuse of the 'waste' after recycling or repairing them. Despite studies highlighting the innumerable benefits of the circular economy, its adoption is largely limited to symbolism or corporate social responsibility (CSR). As a study report states, “Currently, only 7.2 percent of used materials are cycled back into our (global) economies after use.” Countries like Nepal feature nowhere in this global debate and practice of a circular economy.

Waste-led growth

The very foundation of the current dynamics of economic growth is drafted into the economy of wastage. In other words, the ability to grow for any modern economy correlates directly and positively with its ability to waste. If the practice of wasting more than consumption is put on hold, the growth of any economy or firm will stop. This extremely critical aspect of causation or correlation is the least researched phenomenon by any modern-day economist, even those obsessed with sophisticated quantitative modelling.

For example, if all iPhone users continue using their older version until they become unusable or don’t throw or 'waste' them, the remarkable growth story of Apple Company will be dampened. Or, if you order a cup of coffee in Starbucks, you get more 'materials' (a printed cup, plastic lid, a stir, sugar packaged in a paper pouch and an accompanying wipe-tissue) to waste than the 'item' to consume (coffee). These materials added in the so-called 'value chain' of the branding and packaging process not only add cost to the end consumer but also keep other industries running by providing employment to many and paying government taxes. Thus, the economy-level consequences of serving coffee with bare minimum 'materials' and recycling and reusing them are easily surmisable.

The same applies to other items like consumer electronic devices, cars, garments, and hundreds of different products. If the growth of a whole economy is all about the aggregate output of the firms, their growth will also be automatically affected proportionately. The process, especially the kind of energy used, in the recycling and repairing of the potential waste is equally important. If paper waste is recycled, for instance, by using fossil fuel or other non-renewable energy sources, the purpose of recycling—to save the environment—may be defeated. This is why many recycling and reuse practices are only of symbolic value rather than ensuring economies of scale or desirable ecological outcomes.

The big picture

Even the smallest effort for eco-friendly production and consumption practices is undoubtedly important. But until the larger causes of environmental degradation are effectively addressed, these symbolic gestures of producing goods by recycling may never create a sizable circular economy. If the economies cannot produce enough clean energy, anything recycled using black energy may have a far more detrimental impact on the environment than the benefits accrued from the reusable materials. It is critical since the quality of fabrics, papers, plastic, glass, iron products, etc., produced through recycled processes, more often than not, is perceived to be inferior to their original self. Thus, the consumer uptake of recycled products remains subdued globally.

Realistically, the possible 'circularity' of the products is still taken as more of a municipal waste management strategy than a true potential of creating a circular economy per se. National governments of even the developed countries have assigned the complex task of separating different types of waste, regulating and sending them to the recycling industries to their municipalities. The trickiest part is that the used items, which can be a resource for recycling, are unlikely to be available at an industrial scale unless they are collected from the waste disposed by the masses.

The robotics technology and emerging potentials have certainly brewed new optimism for tasks like separating, grading, and recycling of municipal waste. However, accessibility and affordability of these technologies for poorer countries remain a daunting challenge.

Also, the overhyped use of clean energy and electric vehicles as an ultimate panacea has its own limits of abundance and recycling challenges. No solar or any other renewable energy will likely replace aviation fuel for long-haul aircraft and heavy cargo ships in the foreseeable future. Still, about 55 percent of electricity is still generated by burning fossil fuels. Coal, the most carbon-intensive fossil fuel, still supplies nearly 35 percent of global electricity. The aggregate use of fossil fuels to generate electricity in the fast-growing and most populous economies like China and India is still increasing. In 2023, these countries burnt 5 percent and 8 percent more coal than last year, respectively. The largest source of clean energy, hydropower, contributes only about 17 percent of the 25,500 terawatt hour of yearly global consumption.

When key human supplies like fuel and food (including their own production) are unlikely to be environment friendly anytime soon, and unless they are drastically reformed to be so, the efforts to set up circular economies of minimal scale will hardly make any substantive contribution to reducing the environmental degradation and global warming.

Finally, a change in the behaviour of mass consumers is imperative for a circular economy to materialise. There is a great deal of apprehension and class biases in using products made of recycled materials. The gap between archetypal perception and science is wide. For example, even an educated consumer hesitates to consume the drain water made securely potable through a due recycling process. Similarly, there is a deep-rooted economic class consciousness on using recycled cloths, plastics and paper products.

To enable entrepreneurs to adopt a circular business model at the micro level, the macroeconomic superstructure must first be made more friendly to a circular economy ecosystem, encompassing a supply of clean energy, a dedicated financing mechanism for recycle-based industries, scientific infrastructure to assuage everyday consumers about the products and an efficient market for such products.